Questions we are asked

Setting up, permits and fees

• How much of a Thai company can a foreigner hold?

  Save where a sector statute or the Land Code provides otherwise, there is no general ceiling on shareholding as such. What matters is that once foreigners hold half or more, the company is itself a foreigner under the Foreign Business Act B.E. 2542 and cannot carry on any activity in the schedules without permission. The usual answers are a licence, a certificate under a treaty or free trade agreement, or BOI promotion.

• Once the company exists, can it apply for a work permit straight away?

  Not always. The Department of Employment looks at paid-up registered capital together with the number of Thai employees. As a general rule that means two million baht of capital and four Thai employees for each foreigner. BOI-promoted companies work to a different set of criteria. These figures move with the regulations and with the officer's discretion, so check them before planning headcount.

• What is the difference between a visa and a work permit?

  A visa governs entry and stay and comes from an embassy or from the Immigration Bureau. A work permit governs working and comes from the Department of Employment. Someone holding a perfectly valid visa still may not work until the permit issues, and working without one carries penalties for the worker and the employer alike.

• Do I have to come to Thailand in person?

  Most registration work can be done under a power of attorney, but some steps cannot. Opening the bank account is the usual one — most banks want to meet the signatory — and so is collecting a work permit in some cases. We say in advance which steps need you present, so that they can be grouped into a single trip.

• How do documents from abroad have to be certified?

  As a rule, corporate or personal documents issued abroad must be certified under that country's own system and then legalised by a Thai embassy or consulate, before being translated into Thai and the translation certified in turn. This takes time and should be started before anything else, because it is usually what holds the whole matter up.

• How are fees worked out?

  Work with a defined scope — an incorporation, a work permit — is quoted as a fixed fee per matter. Where the scope is genuinely open, as with a Foreign Business Licence, we quote a range and say what moves it. Government fees and translation costs are always separate from the professional fee and are set out in the quotation. Litigation is quoted stage by stage: the claim through to judgment, and enforcement. You may instruct us for either stage or both, as agreed.

• What is not included in the professional fee?

  The professional fee pays for the firm's own work. Amounts payable to others are kept separate: government fees, translation and certification of translations, notarisation and legalisation abroad, courier charges, court fees, and the fees and expenses of the enforcement stage. Travel incurred in handling your matter is charged as actually incurred, calculated at the firm's set rates. Each of these appears on its own line in the quotation, apart from the professional fee.

• What do you need to know before you can quote?

  The facts that fix the scope: who the shareholders are and their nationalities, whether any shareholder is a foreign company, what the business will actually do in Thailand, how many foreigners will work here, which country the documents come from, and whether there is a deadline. For a dispute: the facts in brief, the documents you hold, and the outcome you are after. These come out of the first conversation; the written quotation follows.

• What happens to the fee if an application is refused?

  The fee pays for the work done — preparing, filing and responding to the authority — not for the result. Government fees already paid went to the authority and are not held by the firm. Whether a re-filing or an appeal falls within the original fee or is quoted separately follows the written engagement terms.

Disputes and enforcement

Questions answered in the firm's articles; each links to the full article and the judgments it cites.

• Severance paid, unfair dismissal unsettled

• I signed for the money and signed a release.

  Receiving money and giving up a right are different things, and judgment 1392/2544 indicates that the protection-statute money was payable on an ordinary dismissal in any event. What matters is what the document signed actually covers and the circumstances in which it was signed, which are facts to be examined case by case.

• The company really was losing money. Is there still a claim?

  Judgment 1392/2544 distinguishes an employer in losses that prevent it continuing normally from one restructuring to compete better. What has to be established is therefore the state of the business at the time of the dismissals, rather than the explanation given in the letter.

• One chat, two transfers, one recovered

• The money has gone and nothing was typed at the time.

  Judgment 3622/2568 requires the message to carry the meaning of a loan and rejected an argument that it should be implied from an earlier loan in the same chat. What remains open is fresh correspondence in which such a meaning does appear — a demand the other side acknowledges, for instance. A transfer slip alone evidences that money left an account, not that it was lent.

• The whole chat has been kept. Is anything else needed?

  In the same case the lender had the continuing screenshots in hand but sought to put them in on appeal, and the Court refused because they should have gone in before judgment at first instance under the last paragraph of section 88 of the Civil Procedure Code. Keeping the material is therefore not enough: it has to be filed in full from the start, and the whole stretch of conversation is worth preserving rather than only the messages that seem important.

• Missing the sixty days frees only part

• The notice was late. How should a guarantor respond?

  The point that works is the extent of liability rather than standing, since judgment 5788/2562 confirms the creditor may still sue. What to do is separate the claim into principal obligation and accessories and date each item, because the second paragraph of section 686 releases only accessories arising after the sixty days.

• The notice was sent but the guarantor never collected it.

  Judgment 220/2562 considered a clause by which the guarantor agreed that a letter sent to the address given in the contract counted as duly served whether or not it reached them, and held that even where the post returned it uncollected, service was good. The wording of the service clause is therefore something both sides should read before signing.

• The thirty per cent is not in the statute

• Why do the older judgments cite section 286 rather than 302?

  The provision on money outside execution formerly sat at section 286 and moved to section 302 when the execution part of the Code was revised. Judgments laying down the principle before that cite the old number, as do a great many summaries still. The safer course is to compare the wording of the provision in force rather than to rely on a section number found in a summary.

• If the salary exceeds twenty thousand, is all the excess taken?

  Section 302(3) protects up to twenty thousand baht a month or such amount as the execution officer thinks fit, which allows a higher figure, and the second paragraph directs the officer to consider the debtor's family circumstances and dependants within a range set by the lowest and highest civil-service salary rates. What is actually taken is therefore open to argument on the facts of the particular household.

• Untitled land cannot be adversely possessed

• Thirty years of occupation, but the deed issued only last year.

  Under judgment 8393/2540 time runs from the date the land came to have a title deed, so the years before it do not count toward the ten in section 1382. What existed in that period was a possessory right, which is a different thing from ownership and has protections of its own. Checking the date of the deed therefore belongs before any decision to petition.

• We moved in with the owner's permission.

  Section 1382 requires possession with the intention of owning, and judgment 2397/2563 stresses that the possession must be adverse to another's right. Living there under someone else's permission is therefore a fact to be examined — when and by what circumstances it changed — rather than something that simply accumulates from the day of moving in.

• Acknowledged after expiry, two years left

• The creditor wants a signature on a paper, saying it only confirms the balance.

  What the document is called does not decide the outcome; the date of signing against the date the claim expired does. Signed while the claim is alive, judgment 4507/2547 starts the original period again in full; signed after that, judgment 12264/2555 gives the creditor two years. Either way the debtor's position changes, so the work that belongs before signing is fixing the date the claim expired.

• Part of it was paid before anyone realised the claim had expired. Can it be recovered?

  The first paragraph of section 193/28 answers this directly: it cannot be recovered, even if the payer did not know the claim had expired. What remains unpaid is a separate question, and the second paragraph of that section speaks of acknowledging liability in writing or by giving security, so the form the act took matters. It also provides that this cannot be relied on against the original guarantor.

• A co-guarantor pays, time runs for the rest

• I guaranteed jointly with someone who is still paying. How does time run for me?

  Under judgment 6403/2561 a co-guarantor's payment binds that person alone and does not reach the others, by section 295, so each person's reckoning runs from the events that bound them. That cuts both ways, because a binding event may have been an act of the principal debtor, which under section 692 does reach every guarantor. What has to be assembled is the full list of events, not only the visible payments.

• The debtor was sued years ago. Can the guarantor still be sued now?

  Judgment 3104/2558 indicates that suing the principal debtor interrupts time and, under section 692, does so against the guarantor as well. The period already elapsed is left out of account and time runs again from the date that case became final, under the second paragraph of section 193/15. Counting from the debtor's first default therefore starts at the wrong point; the date to establish is when the debtor's case became final.

• Excess interest is not reduced, it is void

• Years of interest have been paid. Can it be credited against the principal?

  The authorities have not settled this. Judgment 2131/2560 applied everything paid to the principal, holding that section 407 did not bar the borrower; judgment 11645/2554 treated the payments as voluntary and refused to credit them. What separates them is the circumstances of the payments and how the issues were framed, so the payment records are the place to start rather than a general rule.

• The contract says exactly fifteen per cent, but a deduction was taken when the money was handed over.

  The figure on the document is not conclusive. Judgment 261/2516 separated the sum in the note into real principal and advance interest above the cap, and judgment 11645/2554 confirms that oral evidence to show the recorded debt is not genuine is not barred. Section 4(3) of the same Act also reaches benefits taken beyond interest that are plainly excessive.

• Debt recovery in Thailand: a guide for foreign creditors

• Our invoices are more than two years old. Is the claim time-barred?

  Not necessarily. The two-year period in section 193/34(1) of the Civil and Commercial Code does not apply where the goods or work were for the debtor's own business; the claim then has five years under section 193/33(5). A part payment or a written acknowledgment of the debt also interrupts limitation under section 193/14.

• What interest can we claim on an overdue invoice?

  During default, interest at the section 7 rate plus two per cent a year under section 224, or a higher rate where there is another lawful ground for it, such as the contract. Section 7 sets three per cent a year, a rate that may be adjusted by royal decree.

• Can a creditor based abroad be ordered to pay money into court?

  Yes, where the conditions in section 253 of the Civil Procedure Code are met: no domicile or place of business in Thailand and no property in Thailand liable to execution, or reason to believe costs would not be paid. The court may then order a deposit or security for costs, and the case is struck out if the order is not complied with, unless the defendant asks for it to continue or the order is appealed.

• Unpaid invoices in Thailand: two years or five to sue?

• We sold machinery to a Thai company for its factory. Two years or five?

  Goods bought for use in the buyer's own business fall within the exception to section 193/34(1), so the claim has five years under section 193/33(5). The Supreme Court has applied the exception to goods bought for manufacture (7115/2544) and for construction work (9197/2551).

• Does the five-year period also cover freight we paid for the buyer?

  Where the freight arose from the sale of goods the buyer took for its business, judgment 6198/2548 held it to be money advanced for the debtor's business, with five years like the price.

• What if the buyer is an individual buying for personal use?

  Then the exception does not apply, and a trader's claim for the price has two years under section 193/34(1).

• Petitioning a Thai company into bankruptcy

• Do we need a court judgment before petitioning?

  No. Section 9(3) requires only that the amount of the debt can be determined with certainty, and the Supreme Court has held that a creditor need not sue for judgment first (471/2548, 212/2567, 540/2567).

• We are based abroad. How long do we have to prove our debt?

  Two months from the publication of the absolute receivership order under section 91, which the official receiver may extend by up to two months more for a creditor outside the Kingdom. The extension has to be sought.

• Does one demand letter give rise to the presumption of insolvency?

  No. Section 8(9) requires written demands at least twice, at least thirty days apart, and the demands must concern the debt the petition is founded on (6117/2552).

• Personal guarantees from Thai company directors

• Can we require a director to be liable as a joint debtor?

  Not an individual. Section 681/1 makes such a term void. Only a guarantor that is a juristic person can agree to be bound as a joint debtor, and it then gives up the defences in sections 688 to 690.

• Our guarantee was signed in 2013 and makes the director a joint debtor. Does it still work?

  The joint-debtor ban does not affect contracts made before the amendment came into force (section 18 of Amendment Act No. 20; judgment 5788/2562), and in judgment 160/2566 a joint-debtor term in guarantees signed in October 2014 remained enforceable. The sixty-day notice rule in section 686 still applies if the company defaulted after the Act came into force (section 19; judgment 5788/2562).

• Can the director insist that we pursue the company first?

  The director can ask that the company be called on to pay first under section 688, and under section 689 can require the creditor to enforce against the company's property first by proving it has the means to pay and that enforcement would not be difficult.

• Bounced cheques in Thailand: claim or complaint

• The cheque has bounced and the customer asks us to present it again next month. Do we lose anything by waiting?

  Possibly the criminal route. The three months run from the first refusal, and a re-dated cheque presented again does not start a new offence (judgment 984/2535). The civil year runs from the date on the cheque (judgment 9539/2544).

• Can we sue on the invoice instead of the cheque?

  Yes. A debt paid by cheque is discharged only when the cheque is paid (section 321), so the claim on the underlying debt survives within its own period, provided the debt itself can be proved (judgments 1275/2504 and 2013/2537).

• The cheque was given as security before the work was done. Is there an offence?

  Usually not. The Act covers only a cheque issued to pay a debt that existed and was enforceable when the cheque was issued; the Supreme Court has found no offence where the debt arose only later (judgments 7615/2538 and 1237/2565).

• Foreign Business Licence in Thailand: cost, requirements and timeline

• How much does a Foreign Business Licence cost in Thailand?

  In government fees, 2,000 baht to apply. The List Three licence itself costs 5 baht per 1,000 baht of registered capital, at least 20,000 and at most 250,000 baht. Professional fees are separate.

• How long does it take to get a Foreign Business Licence?

  The Act gives the Director-General 60 days from a complete application to decide on a List Three business. The licence follows within 15 days of approval. Preparing the application usually takes longer than the review itself.

• Is there a faster route than a licence?

  Yes, where the business is BOI-promoted or covered by a treaty. Either way the company receives a certificate within 30 days of notifying the Director-General (sections 11 and 12).

• Can Thai shareholders hold shares for us instead?

  Not to avoid the Act. Nominee shareholding is an offence under section 36, for the nominee and for the foreigner who agrees to it. The penalty is up to three years' imprisonment, a fine of 100,000 to 1,000,000 baht, or both.

• How to sue a company in Thailand: the court, the costs and the steps

• Can we bring the case in English?

  No. Proceedings in the Thai courts are in Thai. Documents in English are filed with Thai translations (Civil Procedure Code, section 46).

• How much is the court fee to sue a company in Thailand?

  2 per cent of the amount claimed up to 50 million baht, capped at 200,000 baht. The part of a claim above 50 million baht adds 0.1 per cent. Lawyers' fees are separate.

• What if the Thai company ignores the claim?

  If it files no defence within 15 days of service, the plaintiff can apply for judgment by default under section 198. The plaintiff must apply in time, or the court strikes the case out.

• How long do we have to appeal?

  One month from the day the judgment is read (section 229). A further appeal to the Supreme Court needs that court's permission, applied for within one month of the Court of Appeal's judgment (section 247).

• Does a BOI company exporting 100% need an FBC? It depends on contract manufacturing

• Does a company that is majority Thai-owned need an FBC?

  No, if Thais genuinely hold more than half and there is no indirect foreign holding that brings it within section 4, the company is not a foreigner under the Act. The holding must be real: holding shares for a foreigner to avoid the law is an offence under section 36, for the nominee and for the foreigner who agrees.

• We make to the customer's design and brand but buy the materials ourselves. Do we need an FBC?

  Generally not. The company makes its own goods and sells them; the customer's design or brand does not turn a sale of goods into a service. Check, though, that the contract does not pass ownership of the goods to the customer during production.

• We export in our own name and apply 0% VAT. Does that make it a sale of goods?

  Not necessarily. Revenue Department ruling Kor Kor 0706/2575 treated a contract manufacturer that filed export entries in its own name as selling goods by export for VAT, yet in the same ruling required it to recognise income as hire of work. Each law has its own test, so the tax classification does not decide the position under the Foreign Business Act.

• How long does an FBC take for a BOI company?

  Section 12 requires the Director-General to issue the certificate within 30 days of being notified of the promotion certificate. The documents to file follow the Director-General's rules.

• Is an FBC valid forever?

  No. The section 12 exemption lasts as long as the business is promoted. If the promotion ends, or the company expands into activities the certificate does not cover, the licence question has to be looked at again.

• Registering a company in Thailand: the name, the shareholding, the foreign business licence and work permits

• How much of a Thai company can foreigners own?

  Apart from limits in particular sector laws and the land law, there is no general cap. What matters is that once foreigners hold half or more of the shares, the company is a foreigner under the Foreign Business Act B.E. 2542 (1999) and may not carry on a listed business without permission. The usual routes are a licence, a certificate under a treaty or free trade agreement, or BOI promotion.

• Can we apply for work permits as soon as the company is registered?

  Not always. The Department of Employment looks at paid-up capital and the number of Thai employees together. The general rule is 2 million baht of registered capital and four Thai employees for each foreign employee; BOI-promoted companies follow a different standard. These figures can change with the rules and with the officials' discretion, so check them before planning staff.

• How much registered capital should we have?

  There is no figure that fits every case. The capital should at least match two things: the number of foreign employees who will need work permits, and the company's real funding needs. The Department of Employment looks at paid-up capital, not just the registered figure, and the proportion and timing of payment should be checked case by case. Too low limits staffing; too high means paying the shares up in full and carrying more to maintain. The government fee for registration is a fixed amount and does not vary with the capital.

• Do we have to come to Thailand in person?

  Most registration work can be done under a power of attorney, but not every step. The most common exception is opening a bank account, where most banks require the signatories in person, and in some cases collecting a work permit. List the steps that need a personal visit at the start, so they can be done in one trip.

• How long does the whole process take?

  This guide gives no number of days, because the registration itself is rarely what sets the pace. Three things do: how quickly foreign documents are legalised and translated, whether the name is approved first time, and whether the business needs a foreign business licence. The first is usually the bottleneck and should be started first. The full sequence, how each step depends on the others, and which steps depend on outside or foreign authorities, should be listed at the start.

• Work permits and visas in Thailand: the difference, the order and the yearly cycle

• I already have a business visa. Can I start work?

  No. The visa deals with entry and stay; the work permit deals with work, and the two are issued by different authorities. Until the Department of Employment issues the work permit, even a fully valid Non-Immigrant B visa does not allow work.

• Can I come to Thailand first and arrange the visa and work permit here?

  It depends on the visa you enter on. A tourist visa or visa-exempt entry ordinarily cannot support a work permit. Where the conditions are met, the visa category can be changed in Thailand, but check the conditions and documents before travelling, not after arriving.

• Our company has just been registered. Can it apply for work permits at once?

  Not always. The Department of Employment looks at paid-up capital and the number of Thai employees together; the general rule is 2 million baht of registered capital and four Thai employees for each foreign employee, and BOI-promoted companies follow a different standard. These figures can change with the rules and with the officials' discretion, so check them before planning staff. A new company also often has no financial statements, tax filings or social security record yet, which is usually the real obstacle.

• Does a foreign director who only attends meetings and signs documents need a work permit?

  Possibly. Thai law does not treat payment as the only test; whether a director attending meetings and signing documents is working depends on what the activity involves and how often. Assessing it before the trip is planned is far safer than after arriving.

• Can one person work for two companies at the same time?

  A work permit is tied to the employer, position and workplace it names, so an existing permit cannot be used to work for a second company. Whether a separate permit can be obtained for the second job, whether two can be held at once and on what conditions, should be checked case by case against the law and the authority's practice at the time.

• Can ninety-day reporting be done by someone else or online?

  Usually it can be done in person or by someone authorised, and the Immigration Bureau opens other channels from time to time. The channels available and their cut-off times change, so do not rely on a single channel close to the due date; check first. The duty attaches to the right of stay and has nothing to do with the work permit.

• What happens if I leave without a re-entry permit?

  First check what the passport actually records. Some visas and permissions already allow re-entry. Otherwise, an extension of stay ends on departure: on return you start again from a new entry permission and go through the extension process again, and a work permit resting on that status loses its footing. The remedy depends on the case, and costs more than checking and applying beforehand.

• When I change jobs, can my work permit be moved to the new company?

  No. A work permit is tied to the employer it names, so changing employer means a new application, not a change of name. The old employer must report the departure, the permit must be returned as required, and the right of stay must be dealt with within the set time. Plan the gap before resigning.

• BOI investment promotion: shareholding, staff and the obligations beyond the certificate

• With BOI promotion, do we still need a foreign business licence?

  Within the approved project a separate licence is ordinarily not needed. Instead the company uses its promotion certificate to obtain a certificate from the Department of Business Development under section 12 of the Foreign Business Act, which the Department must issue within 30 days of notification. The effect stops at the project boundary: a business in the lists of the Foreign Business Act B.E. 2542 (1999) that the company carries on outside the project still needs its own licence or certificate. Check the procedure and timing for the certificate before operations begin.

• Does promotion cover all of the company's business?

  No. Promotion is granted to a specific approved project. One company can have promoted and unpromoted business side by side, with income and expenses accounted for separately as the approval conditions and tax rules require. Whether a new line of business falls within the approved scope is a question to answer before starting it, not when the annual return is filed.

• With BOI, do work permits still depend on capital and the Thai staff ratio?

  Promoted companies follow a different standard from the general rule. The general rule is 2 million baht of paid-up capital and four Thai employees for each foreign employee, which can change with the rules and the officials' discretion. Which standard a promoted company follows, whether each foreign position needs approval and whether there is a quota, should be checked with the authorities before planning staff.

• How long is the tax holiday, and when does it start?

  The length and how it is counted depend on the project's activity type and approval conditions, and cannot be stated in general. The ceiling and counting rules under the current system have to be confirmed against the announcement in force and the company's own approval, not inferred from another project's conditions.

• Must a Thai company be set up before applying?

  The order of applying and setting up the company should be checked against the rules in force when the application is made. Either way, a Thai company registered with the Department of Business Development must in the end hold the promotion certificate. It must also register for tax, for VAT once over the threshold, and with the Social Security Office as an employer once it hires staff. The timing of bank accounts, leases and staffing should be planned around that sequence.

• What if the project's capacity, location or shareholding is to change?

  Most changes need an application to the BOI beforehand, not a report afterwards. Which changes need prior approval, and at what threshold, should be checked before the business decision is made, because an unapproved departure is itself grounds for revoking the privileges.

• What happens if promotion is revoked?

  At the least, the project no longer has the rights that came with promotion, including the advantages on shareholding and staffing, and the company has to go back to the licence or certificate route. Whether tax privileges already used are clawed back depends on the grounds and legal basis of revocation, and should be checked as soon as a departure occurs.